Replies to post #49838 on Zion Oil & Gas Inc (ZNOG)

[microcaps1]

looking at a map the well is more like only 5-6 miles S of Beth Shean-doesnt seem possible but Israel is such a small country

[KyOil]

hey micro, the $10 to $20 market value per barrel of proven reserve is from benchmarking O&G exploration companies like Zion. And the benchmark companies have "proven" reserves whereas Zion will announce "possible" reserves.

But, Zion will create excitement with the announcement, so I'm simply assuming the excitement (positive) offsets the lower class reserve (negative) in the pps.

The price of oil, PE ratio, ongoing capital, ability to find additional reserves, etc is all factored into the benchmark. The process is simple:
Divide the market value of the benchmark by its proven reserves to get $/barrel.

The key for all O&G exploration companies is the ability to find new discoveries at the rate at which they produce; otherwise they run out of resources and the value goes to zero. This is factored into the benchmarks.